Business Secretary Vince Cable indicated he is considering reforms to the "public interest test" for corporate takeovers as a political row erupted about US pharmaceutical giant Pfizer's move for AstraZeneca.

Mr Cable said the Government had been "looking at the options around the public interest test" after Labour leader Ed Miliband demanded a full assessment of the potential deal.

AstraZeneca spurned a new £63 billion takeover offer from US rival Pfizer last week, saying it "substantially" undervalued the business and the pharmaceutical giant is reported to be considering its next move.

The Labour leader has written to David Cameron calling for the publication of any analysis the Government has made of the proposal and claimed the Prime Minister had been acting as a "cheerleader" for the proposed deal.

He proposed widening the scope of the public interest test to take in industries of strategic importance - such as the high-value scientific research carried out by AstraZeneca.

"If I was prime minster I would be bringing in a new public interest test ... widening the scope of the current public interest test, which says that when we have the largest takeover in British history, with all the implications it has for our science base, there's got to be an independent assessment of the implications of this for our national interest," he told BBC1's Andrew Marr Show.

The Government can currently intervene on mergers or takeovers where there is a national security issue, an issue of media plurality, competition concerns or if it could affect financial stability.

Asked about reviewing the test, the Business Secretary said: " Obviously we are looking at this option amongst others, I'm sure you wouldn't expect me to go into all the detail and the discussions we are currently having between the two parties to the proposal.

"What we are endeavouring to ensure in the Government is to make absolutely sure Britain's excellent science base and pharmaceutical research is properly protected, manufacturing in the UK, decision-making, those are the issues we are talking to the companies about."

Mr Cable said he had spoken to the chief executives of both firms and stressed that the Government was "strictly neutral" between the two.

Mr Cameron has said the Government had received "robust" assurances from Pfizer about protection for British jobs and research under the proposed deal and stressed it was a decision for shareholders.

The Liberal Democrat Business Secretary said there was a "lot of small print to study" in the assurances given by Viagra manufacturer Pfizer.

"W e publicly welcome the fact that a letter has been issued by the company which underlines the importance we attach in Government to protecting British science and jobs and investment and manufacturing and decision-making in the UK but obviously there is a lot of small print to study, the question about how these obligations are binding and of course we're talking about two companies here and we're strictly neutral as between the two."

He said that the British competition and merger regime was non-political in the way it applied " but there is an important national interest here".

Mr Cable's comments were in contrast to Tory attacks on Mr Miliband over his intervention in the row.

Conservative Party chairman Grant Shapps accused the Labour leader of "playing politics with people's jobs" and being "anti-business in every single way".

He told Channel 4 News: "We won't cheerlead for a bid one way or the other but we will be absolutely certain if it goes ahead that it's good for jobs, good for research and development - particularly in some of those life science areas where Britain has a really strong lead - and that it benefits the country.

"Those are the simple tests and it can't go ahead unless it does all those things."

Mr Miliband said "no other country in the world would be waving this bid through" and claimed the Government had been given "pretty weak assurances" by the US firm which had a " pretty dubious record when it comes to their record in this country and other takeovers".

In his letter to Mr Cameron the Labour leader said: "I am strongly of the view that, when it comes to such a strategically important part of UK PLC, we need a more substantive assessment of whether this takeover is in the national economic interest before the UK Government allows itself to be seen to be supporting it.

"There are reasons to think that such an assessment would be of value. Firstly the company's track record in the UK raises concerns, including their decision in 2012 to close down the world-renowned R&D facility in Sandwich, leading to the loss of 1,500 jobs.

"Secondly AstraZeneca currently spends a significantly higher proportion of its turnover on R&D than Pfizer - a crucial concern given the importance of pharmaceutical investment in R&D to the UK science base.

"Lastly there are concerns about Pfizer's wider track record regarding the impact on research of previous takeovers."